A few months back when Auckland Council and the government released vastly different results from their (supposedly) joint review of the City Rail Link’s business case, we learned that the process of determining whether a project is “worth it” is not the objective exercise that is so often portrayed. The government’s review said the project’s cost-benefit ratio was 0.4 while Auckland Council’s review put that number at around 1.1. As both parties were fairly agreed on the costs, it was debate over the magnitude of the benefits that really led to the disagreement. As an interesting sequel to this debate, a recent paper discussed at the Council’s Economic Forum today, put together by Auckland Council’s chief economist and based on work done by the NZ Institute for Economic Research that looks at a key component of this debate: the ‘discount ratio’ used. The concept is discussed below:

A country’s social discount rate policy should attempt to solve two distinct problems (with ideally two distinct instruments). The first is to take account of an infrastructure project’s ‘wider economic investment’ effects. This means ensuring that public projects do not crowd out/replace even more profitable private sector projects, as measured by their social opportunity cost – as well as taking account of how productivity improvements stimulate more private sector investment. These wider investment benefits and opportunity costs can differ significantly between projects, depending on how the original investment was financed and the kind of benefits they provide. Taking account of these features is critical to ensure value for money.

The second problem is determining the social rate of time preference. It is well accepted by economists that individuals and society in general, place a higher value on benefits and costs that occur in the near future vis-a-vis those that occur many years into the future. Consider for example, asking a two-year-old if they would like a lollipop today, or two lollipops in a years’ time. The social discount rate makes a judgement on the value of benefits and costs received in the future. This “time value” judgement is critical for the aspirations of sustainable investment in New Zealand’s transport network and our corresponding level of wealth over time. The social discount rate currently used in the assessment of transport projects is 8% (real, meaning net of general price inflation; all discount rates here are expressed in real terms).

This is a somewhat overly complex explanation in my opinion. My understanding of discount rates is to ensure that we know it’s better of putting money into a project than just chucking it in the bank. Having $1000 of benefit now is more valuable than getting that $1000 of benefit next year, because if you put your money in the bank you’re going to earn something off it.

In any case, the main debate in the paper is not over whether we should both having a discount ratio, but rather what that ratio should be and whether the benefits should be “chopped off” at some point in the future. Different projects have different types of benefits, some which happen quicker and some which last longer. A useful example of how two projects (one with short-term benefits and one with long-term benefits) compare is outlined below:

This 8% real social discount rate means that policy-makers equate a unit of benefit2 received in 30 years’ time, with 6 cents received today. A reduction in the social discount rate would alter this equation significantly. For instance, at a discount rate of 4%, policy-makers would equate a unit of benefit received in 30 years’ time with 31 cents received today (so benefits in the future are given a higher value). This has important implications for the type of projects approved for funding. A lower discount rate changes the prioritisation of transport projects from those that have benefits in the short term to projects that have benefits further into the future.

For example, Figure 2 illustrates this for two hypothetical projects that are mutually exclusive (that is, doing one means you would not do the other). Project A (e.g. widening a road) realises benefits immediately and sustains them indefinitely, while project B (e.g. implementing a rapid transit corridor) has smaller benefits in the short to medium term but substantial benefits in the longer term.

The decision for which project to invest in lies, in large part, in the value society places on future benefits – a judgment made implicitly by the social discount rate. Using New Zealand’s current discount rate of 8%, project A is preferred over project B, because the benefits from project B are realised in the distant future, which is heavily discounted. In fact, transport project evaluation is currently capped at 30 years because any benefits realised after this period are often discounted to zero. This means that the majority of the benefits of project B are excluded in the benefit cost analysis. In contrast, using a discount rate less than approximately 5% means project B would be preferred over project A.

Here’s the image:What gets really interesting is when this theoretical debate gets applied to real projects, like the City Rail Link – which has very long-lasting benefits, but benefits that accrue somewhat slower than smaller projects like widening a road.

Figures 3-6 below illustrate this point using the City Rail Link (CRL). Figure 3 shows the undiscounted benefit stream of the CRL. Notably, the project’s benefit stream is very similar to the long-lived project in Figure 2 above (project B), where benefits are shown to increase into the future. Figure 4 shows the benefit stream of the economic appraisal using a standard New Zealand appraisal following the Treasury guidelines of an 8% discount rate and a time period of 30 years. This gives a discount benefit stream of 1.8 billion and a Benefit Cost Ratio (BCR) in the order of 1.1. However, if the appraisal period was lengthened to reflect the long-lived nature of the CRL, then the benefits attributable to the project would increase to 2.7 billion and the BCR would increase to a figure in the order of 1.5. This is shown in Figure 5 using a 60 year appraisal period. This example shows how current methodology is biased against long-lived projects, because many of the future benefits are simply not included in the standard evaluation.

The graph showing the gradual but consistently growing benefits of the City Rail Link is a very good match with the theoretical “project B” outlined in the graph above:60 years into the future the benefits of the project are quite truly massive, and still growing. This is not really too surprising, the New York Subway continues to provide that city with enormous benefits that grow each time its ridership grows – even though the subway opened over 100 years ago. That was an investment with benefits that have truly lasted the test of time.

Looking at the standard way of measuring benefits, you can see what a tiny fraction of the undiscounted benefits are actually caught:Of course it is appropriate to discount benefits and (possibly) to cut them off at some point. But the quantity of benefit measured using the standard approach seems to be completely tiny compared to the actual amount generated. Extend the appraisal period out (but keep the 8% discount ratio, and you start to capture some of the longer-term benefits of a project like the CRL: But what’s really interesting is looking at what happens when you combine both a lower discount ratio and a longer appraisal period to the process. Interestingly, this is exactly what’s done in the UK and a comparison of the results is shown in the diagram below – comparing the quantity of benefits of the CRL under the NZ and the UK system of assessment: The report goes on to note that the only differences are the discount ratio and the length of time the benefits are measured over:

Figure 6 then uses the CRL benefit stream (from Figure 3) and shows the difference in perceived benefits using the New Zealand standard appraisal and the United Kingdom (UK) appraisal methodology. The only difference between the two is the discount rate and the appraisal period. The CRL shows a present value benefit stream of 1.8 billion under the New Zealand methodology and a BCR in the order of 1.1. Under the United Kingdom methodology, the same project would be shown to have a present value benefit stream of approximately 11 billion and a BCR in the order of 5.2. Using the same benefit information, the UK methodology would place the benefits of the CRL in the order of 6 times as great as under the standard New Zealand methodology.

In other words, if we were undertaking a cost-benefit analysis of the City Rail Link in the UK, the project would have a cost-benefit ratio of 5.2 rather than the 1.1 the Council has measured it as having. That is an absolutely massive difference.

While I imagine transport projects generally score higher in UK assessments, meaning that the threshold for funding is probably a higher cost-benefit ratio than here, the key issue is that the City Rail Link is exactly the kind of project the NZ system is weighted against. If you compare how a project with much quicker (but shorter-lasting) benefits performs under the two systems, the difference is much smaller:So is the UK unusual in the way it measures projects, or are we? Looking an international comparisons it seems that we are the ones who apply an unusually high discount ratio:The report to Council’s Economic Forum proposes that the Council lobby central government to relook at this matter, so that better consideration of long-term projects can be made. I certainly hope the issue is looked at closely so that we’re brought in line with international best practice and to ensure that the full benefits of projects with long lifespans can be given adequate consideration.

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  1. One thing I hadn’t realised that is mentioned here is that the discount rate is real not nominal. So it is net of inflation. So an 8% discount rate is equivalent to 10-11% interest rate in the bank, which does seem pretty high – especially considering the government can borrow at about half this.

  2. You could change transport appraisal in New Zealand, but the result displayed in Figure 2 is fictional. Presuming it is constant value, there is no reason why a road widening project wouldn’t have growing value in real terms over time, because growing traffic will mean that more users benefit from the widening over time compared to the status quo (and the value of time grows faster than inflation, as does the VOSL).

    In short, the order of projects might change in the margins, but projects would (and should) still be prioritised according to BCRs based on ranking. Benefit cost assessment is most useful as a tool to compare options using the same tool, not to compare with different forms of spending.

    Anything with a BCR of 5 should be done over anything with a BCR of 2, notwithstanding benefits that can’t be monetised easily (e.g. protection against earthquakes).

    Appraisal periods can be extended, but when you do that you need to include costs over longer periods (maintenance and renewals, and for anything public transport, the subsidies to operate services). The New York Subway has had mammoth injections of capital over the years to renew infrastructure, about the only thing left are the holes in the ground (which for any tunnel project should be depreciated over a period of around 90-100 years as they are virtually perpetual).

    One of the biggest flaws of all transport appraisal in NZ is that none of the expenditure is depreciated. The government sadly rejected a shift to cost accountancy based economics for roads, despite it being proposed by the RUC Review Group. It would put it in the same footing as other network infrastructure and spread the costs of capital among future generations of users, and charge interest on roads.

    However, back to the main point. The arguments made here don’t address the limitations of the Auckland Council’s own appraisal of the project. Indeed, if you are really honest about the project, it does very little for traffic congestion (Auckland’s CBD has a high PT mode share as it is), and does a lot for downtown businesses, so the question ought to be, why is it not being almost entirely funded (road users should pay for the small congestion reduction benefits) by a special rate on businesses (and homes) within a radius of the stations?

    The inner city rail project is NOT about fixing a transport problem (which comes into the categories of congestion, safety, environment, access and route security), but about Auckland’s ambitions to revitalise its downtown. So its funding shouldn’t come from transport budgets.

    1. Your penultimate paragraph makes the common mistake of assuming that this project only has impacts on the areas immediately above the tunnel. Yes these areas will benefit enormously but the thing that makes this project so useful is the role it will play in transforming the entire existing network, and here it will have an impact on other modes, and will do much to keep congestion below critical levels. Changing what is essentially an attempt to run an intra-city metro service on a terminating inter-city network is crucial in unlocking the currently unavailable capacity latent in this asset. Moving from a one destination focus to a multi stop system will, along with the new faster electric trains and transfer enabling ticketing, make this into a system that will be an attractive option for many many more Aucklanders. People who are clearly just as likely to make economically rational decisions about time, money, and experience costs as people in other cities around the globe.

      These changes, for the first time, mean that Aucklanders will have a real choice to compliment the existing road network. No one is claiming that this will lead to empty roads but rather it will allow us to still use our existing road assets without either total gridlock or the pressure to build ever more expensive and place destroying new ones. While accommodating the city’s growth.

      So the CRL is absolutely a transport project, and is absolutely the best plan in Auckland to tackle your list of issues: congestion, safety, environment, access and route security.

      It also happens to be a great urban renewal project too, and it should be noted that around half of the capex is expected to be contributed locally and much work is being done around the development possibilities at the stations, to help fund this.

    2. I suppose road widening has some benefit, but to an extent for most projects around auckland, demand increases to fill capacity returning congestion to pre-widening levels. Sure, more people may be driving, thereby giving benefit of greater volumes with the same level of service, but is it long term benefit?

      I’d argue that in 10 years we will have less cars on the roads because of the cost of fuel. And in 20 years we would have even fewer cars on the roads because of resource shortages. The benefit of widening the road will have decreasing benefit over time whereas money spent on the CRL will very likely have increasing benefit over time as more people begin to use it.

    3. The fallacy of your understanding of the CRL is demonstrated by your closing paragraph. Without the CRL, we’re four months away from being able to have no increase in the number of services entering Britomart in any given hour. That’s four months until Britomart’s dead-end design reaches the safety-forced limit of 21 trains per hour through the tunnel. But public transport use in Auckland, despite its poor quality and high price by international standards, is growing in leaps and bounds. Rail use is booming. In three years we’ll have bigger, faster trains, but that’s not going to give us any more capacity to feed trains into Britomart. That has impacts right across the network, and across the city. Rail to the airport cannot happen without the CRL. Rail connections to the south-east, into Botany, cannot happen without the CRL. Rail to the North Shore cannot happen without the CRL. We cannot even have an Auckland-Hamilton rail service that terminates at Britomart, unless it hitches to an existing service, without the CRL.

      Do you get it? The CRL is about the entire regional rail network, and the growth benefits for the CBD are just some hefty economic gravy. Without the CRL, Auckland’s rail network is four months away from never running another service to Britomart during the travel peaks. What does widening roads do about that?

    4. “The inner city rail project is NOT about fixing a transport problem (which comes into the categories of congestion, safety, environment, access and route security), but about Auckland’s ambitions to revitalise its downtown. So its funding shouldn’t come from transport budgets.”


      To reiterate:
      Capacity at Britomart is full. Suburban rail frequencies are low, but can’t be improved because there is no capacity at Britomart.

      What will rail ridership do with a 10 or 7 minute frequency on all routes?
      What will rail ridership do on the Western line when it is significantly faster to reach the CBD?
      What will rail ridership do when there are more CBD stations, bringing more of the city to a single seat ride from all the western, eastern and southern suburbs?

      It’s all going to go up, and not by just a little, but a lot.

      The CBD rail loop will be transformative everywhere from Henderson to Papakura (or wherever electrification starts and ends). It will then enable rail to the airport which in itself would be transformative. It’s not about some little bit of urban renewal in the forgotten corners of the CBD, it’s about the whole city (maybe excepting the North Shore). It will mean that Auckland can move on from its 1955 plans for its 1960s future, and join the 21st century. Funding should come from central government and it should come from the transport budget. Only the blinkered, short-sighted (ie the government and the transport minister) would disagree, but we have a chance to change them.

      I support the Auckland CBD loop project even though I don’t come from Auckland and I don’t even really like the place, because I can see it would be the best thing for the country, and it makes a lot of sense to ignore the Potemkin numbers of the so-called studies and see it for what it really would be; transformative of the country’s largest city with the largest agglomeration of business functions.

      1. Touching on that issue, the real transport benefit of the CRL is that it unlocks the true capacity of the whole rail system. Instead of being stuck at one train every 10 minutes we could run one every 2 minutes each way through the tunnel, which probably means one every four minutes on most of the network (depending on how we structure the services). So it more than doubles the capacity of the whole system, plus by creating a second entrance to the CBD effectively increases rail capacity to downtown four-fold.

        But even all that misses the point. Let’s forget the distinction between roads & rail for a minute and just think of everything as “transport infrastructure”. Currently much of our transport infrastructure (roads at peak times) are at capacity and it’s incredibly hard to boost that capacity. Yet one part of the transport system (rail) has huge spare capacity, if only it wasn’t constrained by a bottleneck (Britomart).

        The hilarious thing about MoT’s assessment of the CRL is that they did not consider road capacity (for cars or buses) as constrained. Not that I like to compare traffic & water pipes, but that’s like ignoring capacity constraints of your water network when deciding whether you need a new main supply pipe.

        1. Touching on UK schemes again, I think that there is a real similarity here with the Northern Hub scheme, just on a slightly different scale.

          There – using the UK appraisal mechanics to justify up to a $1bn spend with a BCR of 4 – the scheme proposed to spend the bulk of the money to increases train capacity in the core area of Manchester. Yes, Manchester CBD would benefit, but the city regions of Liverpool, Sheffield, Leeds and even Newcastle, each of which could otherwise be competing for monies out of the same pot, all agreed that the increased level of services through Manchester resulting from the scheme, were directly beneficial to them. Indeed, the scheme was originally called Manchester Hub, but the non-Manchester city-regions got it renamed to reflect the much wider range of the benefits.
          The Government supported development of the scheme in a large part because it did not all have to be done at once – the core work released capacity to use immediately, but peripheral works were required for the full benefits to be realised.

          For Liverpool and Leeds there, read Henderson and Manukau here. Similarly, for the peripheral works there, read the Western Line level crossings, Onehunga capacity etc.

      2. Exactly. The CRL HAS to be the next project and it needs to be green lit asap. All other rail projects like the airport ,South East Auckland etc are pointless until this is finished. Does anyone have an accurate picture as to how long the CRL will take to design and build if it was ok’d today? Would the proposed Eastern rail tunnel into Britomart be a quicker solution in the short term given that capacity is anticipated to be reached shortly?

        1. Oh, and why is it that otherwise smart people cannot fathom that increasing capacity of the rail lines / busways will remove cars from the motorway and, if not reduce congestion (which I think it will actually do), should at least keep it at current levels?

        2. The tunnel will take at least five years, and that’s with the Council having already begun work to get the route decided and protected. If full funding was approved they could probably go faster, but there are still some physical and process limits.

          The eastern tunnel (I assume you mean Nick R’s infamous Quay Street cut-and-cover?) would be a distraction from the full CRL, both in terms of consuming planning and consenting time and in terms of sucking up funding that’s already proving incredibly hard to access. Plus it does nothing to open up the western part of the CBD or reduce travel times from the Western Line. The CRL isn’t just about Britomart’s capacity, it’s also about bringing the outer parts of the Western Line closer to the CBD and about increasing the CBD’s catchment for a rapid transit network. The eastern tunnel addresses nothing except Britomart’s capacity constraints, which is a bandaid solution that can be mostly achieved by AT getting beyond the mindset that Britomart must be the focus of every rail service on the network.

  3. Just on the note of rail to the airport. Maybe in the interim we could consider running a service from West direct to the airport without the need to go to Britomart. The catchment would still be large. Ultimately I would love the service to go to the city but we shouldnt have to wait for that

    1. There’s the minor issue of there being no rail line further to the south-west than Onehunga. It’s not just an issue of time slots at Britomart, it’s also that there’s no track to use.

      1. Ofcourse there is no track there….I was referring to the fact that not having a city rail tunnel/spare slots at Britomart should not prevent the line to the airport being built before hand and asap

        1. Given that the line is not just to service the airport, but also to provide commuter rail services to the businesses and residences between Onehunga and the airport, a direct Western Line service fails to be of much use to a majority of those in the target patron base. It would be strictly a line to serve the airport, which just feeds ammunition back to the antis who point to Sydney’s airport white elephant.

        2. As compared to a service between Britomart and the airport-which would have the same issues? Commuters would just have to transfer at Newmarket-and it would allow those businesses and residences between Onehunga and the airport to be connected to the west too without transfer.

        3. Sorry, I misunderstood you. I’d took your post as meaning the full south-western route (ie: Avondale-Southdown-Airport), thus bypassing anywhere convenient for commuters to transfer.

          Given how long it’s going to take for rail to be constructed to the airport, even just as an extension from Onehunga and Wiri, I don’t see a Britomart bypass as being necessary. The CRL will be constructed before such a line is completed.

        4. Ian M – I think you are referring to something that I have raised a few times and at risk of being slapped down, I will raise again. I emphasise, I am massively in favour of the CRL but I also think we have to be realistic about this government and the possibility it may remain in power for another 3 years after the next election.

          That is the possibility, once all the electric trains are operating, of running services straight West-South services through Newmarket without going to Britomart.

          I still think this is a guhely beneficial idea but I have never seen it included in any new timetables or palns for the new rapid network in 2016. This would make it much easier for someone to travel from New Lynn to Manukau or vice versa for work, education etc. If there was a West-South train every 5-10 mins, it would mean that I can get on any train to Newmarket and know that I can go anywhere from there South or West (obviously doesnt help going East).

          I know line improvements would be needed at Newmarket to give a smooth West-South transition but surely that cost would be relatively low and able to be funded by the Council/AT alone?

          If “build the frequency and they will come” is true (and I believe it is) then surely this would be a popular connection and remove any suggestion that the trains are just for CBD workers. If that system is in place and groaning at the seams with people by 2017/18, then surely the CRL becomes a no-brainer, even for a government as pro-auto-dependency as this one?

        5. I agree, but remember it will mean reducing the number of 6 car sets running the other lines, unless of course we order more EMUs, which we will have to do anyway if we agree to extend electrification to Pukekohe. Something to think about?

        6. I’ve proposed West / South service patterns too. Pre CRL, post EMU. Newmarket is a tricky junction, so unfuture proofed. Which i suggest helping by running two western line patterns:

          1. West to Britomart direct skipping Newmarket
          2. West to say Manukau

          Would need to be sufficient frequency to suit both directions…Newmarket bound westeners would have to wait for the south train or transfer at Parnell, which unfortunately will not have an island platform…….. .? Prob need more trains, could grow the market though at the cost of complicating the western service….? Would also speed Britomart western line journeys and explore the future case for not total CBD focused patterns… .?

          Here I think: http://greaterakl.wpengine.com/2012/06/20/an-auckland-metro-possibilities-complications-and-conclusions/

          Oh there’s a map in the comments by Andrew that’s worth a look.

        7. Yes, I believe that was the post that I first read that on and I should have given credit to you for that Patrick.

          I am just surprised it hasnt been discussed more. It seems like such an easy fix that requires almost no new infrastructure (though I know there are through West-South through issues at Newmarket) and would eliminate the bottleneck at Britomart for those services.

          I have sugegsted maybe just having a 3-5min frequency shuttle between Newmarket and Britomart via Parnell with most, if not all, trains going straight through. However, it appears most people dont like that idea. Personally I do, as I have seen in Europe that connections don’t put people off, frequency or lack thereof is what will demotivate people to use PT.

          The through route via Newmarket would mean that the West-South route could operate at the capacity of the EMU fleet unconstrained by Britomart.

          Again, not trying to scupper the CRL but we obviously need to prove demand before public pressure on the government will mean there is no choice but to fund the CRL.

        8. Britomart is the biggest destination, Newmarket the second busiest. Expecting every Southern and Western Line passenger to/from Britomart to transfer two stops short of their destination at the second busiest and pretty constrained station is inefficient and would be unpopular. having some western liners to do so seems to me to be fine, especially given the frequency on the Southern line.

          Newmarket is a tricky junction though so there will be constraints there; partly why the Western direct service appeals. Also this is very much a poor idea compared to the CRL itself of course. I know some of my fellow bloggers dislike varying service patterns too. Although by offering increased frequency and speeds i see this as a lesser evil.

          Currently there is little demand at Manukau too, but that will change.

        9. Has there even been a case made for putting in place a train-tram system in Auckland as an extension of Britomart:http://en.wikipedia.org/wiki/Train-tram

          I was thinking last night that you could have a short tunnel with a gentle slope from Britomart under Customs Street East and coming up in Queen Street to become a tram. It could then go up a pedestrianised Queen Street with a dedicated ROW maybe with underpasses at the busy streets, under/over SH1 and then becoming a train again at Mt Eden station and proceeding on the Western line.

          Again, I am not attacking the CRL or looking for excuses for not building it. I think the CRL is a fantastic idea. But a tram up Queen Street has already been mooted and this would fit in with that. The same light rail lines could also be used for the tram from Wynyard up Queen Street (and then to Uni???). You could then have tram stops all up Queen Street at roughly the same places as now planned for the CRL.

          I am assuming too that this would be cheaper with much less tunnelling (just a few cut and cover under passes) but I could be wrong.

          I am not an expert on transport infrastructure but I know many of you are, so please critique!

        10. I think it’s too late for that now, as we have ordered EMUs instead of tram-trains. We would have to do it to the whole fleet as the platforms would need to be significantly lowered (or the tracks raised). I believe Britomart is designed with tram ramps in mind, so it’s not too silly. I think, however, that we are better off just building the Wynyard to Mt Eden tram line (via Queen and Quay St’s) and have people transfer at Mt Eden / the Inner West Interchange to a tram if they wish. Some western line trains would then terminate or go south at Newmarket freeing up room for more Southern and Eastern services, until of course the CRL is built. A problem with this is of course that it gives politicians an excuse not to fund the CRL, but it will be needed anyway. This tram network can then be extended down Dominion Rd, Great North Rd, Ponsonby Rd and others.

        11. Hamish O – Thanks for that feedback.

          Yes, I assumed the trains would be the problem. I assume major changes would be needed to the ordered EMUs to operate as a train-tram? I am not aware of the technical requirements that make a train-tram work. Is it about height of the platforms mainly? Couldn’t we just have the train-tram running in a slightly lowered ROW down Queen Street with slightly raised platforms at the tram stops on Queen Street? Would that then preclude it being used by a true tram?

          I don’t see any of these schemes as damaging to the CRL case as I am optimistic that if we can prove to the people of New Zealand that PT can work by steadily increasing patronage, then I think when peak time congestion gets bad on trains (as is already starting on the Southern line, where I travel from Ellerslie) there will be a popular movement to get the CRL done.

          Right now, with a 7% mode share, the trains dont have that critical mass of support. If we could get it up to 15% with buses at another 10-15% then maybe that mass will exist. I see the West-South line as critical for that.

        12. Putting the trains in a trench could work. Another issue might b rail gauge. Our mainlines are cape gauge, and that isn’t changing (freight), but tram line are typically standard gauge. We would therefore have to build the tram lines as cape gauge, meaning standard trams couldn’t be used and we would have to get our trams specially mode or modify the boogies if we are buying them second-hand.

        13. With trains every 10 minutes all day from 2015 a West-South link provide the benefits you suggest.
          The main benefit of a West South link is that if Western line train are at capacity, but Britomart has no more space to fit any new trains. Hence forced to add West-South link.
          The main issue with tram trains is about safety. Yes you could run EMU’s along Queen St but whole corridor would probably have to be fenced off. Alternatively you could put them in a trench however that would be very expensive, and would end up spending most of money on CBDRL on that.
          Trams on a seperate network can operate under a different safety regime hence handle on street running.
          Tram trains generally work best when a city with an existing extensive tram network starts operating these on regional rail services to small outlying towns. None of the examples try to combine an heavy frequent metro operations (like Aucklands will be in 2015) with central city running.

  4. It probably won’t do much in the way of removing cars from the roads, there will always be more demand to drive at peak time than we could provide roadspace for.

    The real value comes from being able to greatly increase the number of people travelling without making road congestion worse (or needing to build a bunch more super expensive road capacity), As Admin says unleashing all that latent capacity in the rail system. The busway is a good example of this, the number of cars crossing the bridge each morning has flat lined while the number of people crossing the bridge continues to increase.

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